Assuming the demand curve is more elastic (flatter) than the supply curve, which

Question

Assuming the demand curve is more elastic (flatter) than the supply curve, which of the following is true?
Answer
a. It does not make any difference how flat (elastic) the demand curve is; the tax is always split evenly between buyer and seller.
b. The smaller the portion of a sales tax that is passed on to the consumer.
c. The full tax is always passed on to the consumer no matter how flat (elastic) the demand curve is.
d. The full tax is always passed on to the seller no matter how flat (elastic) the demand curve is.

Explanation / Answer

b. The smaller the portion of a sales tax that is passed on to the consumer.

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